Correlation Between Hyliion Hldg and Kimball Electrnc

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Can any of the company-specific risk be diversified away by investing in both Hyliion Hldg and Kimball Electrnc at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Hyliion Hldg and Kimball Electrnc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyliion Hldg Corp and Kimball Electrnc, you can compare the effects of market volatilities on Hyliion Hldg and Kimball Electrnc and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Hyliion Hldg with a short position of Kimball Electrnc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyliion Hldg and Kimball Electrnc.

Diversification Opportunities for Hyliion Hldg and Kimball Electrnc

0.75
  Correlation Coefficient

Poor diversification

The 3 months correlation between Hyliion and Kimball is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Hyliion Hldg Corp and Kimball Electrnc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimball Electrnc and Hyliion Hldg is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Hyliion Hldg Corp are associated (or correlated) with Kimball Electrnc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kimball Electrnc has no effect on the direction of Hyliion Hldg i.e., Hyliion Hldg and Kimball Electrnc go up and down completely randomly.

Pair Corralation between Hyliion Hldg and Kimball Electrnc

Given the investment horizon of 90 days Hyliion Hldg Corp is expected to under-perform the Kimball Electrnc. In addition to that, Hyliion Hldg is 1.86 times more volatile than Kimball Electrnc. It trades about -0.07 of its total potential returns per unit of risk. Kimball Electrnc is currently generating about 0.04 per unit of volatility. If you would invest  1,216  in Kimball Electrnc on July 7, 2022 and sell it today you would earn a total of  603.00  from holding Kimball Electrnc or generate 49.59% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy99.8%
ValuesDaily Returns

Hyliion Hldg Corp  vs.  Kimball Electrnc

 Performance (%) 
       Timeline  
Hyliion Hldg Corp 
Hyliion Performance
0 of 100
Over the last 90 days Hyliion Hldg Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's essential indicators remain quite persistent which may send shares a bit higher in November 2022. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Hyliion Price Channel

Kimball Electrnc 
Kimball Performance
0 of 100
Over the last 90 days Kimball Electrnc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Kimball Electrnc is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Kimball Price Channel

Hyliion Hldg and Kimball Electrnc Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Hyliion Hldg and Kimball Electrnc

The main advantage of trading using opposite Hyliion Hldg and Kimball Electrnc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyliion Hldg position performs unexpectedly, Kimball Electrnc can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Kimball Electrnc will offset losses from the drop in Kimball Electrnc's long position.
Hyliion Hldg vs. Amazon Inc
The idea behind Hyliion Hldg Corp and Kimball Electrnc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
Kimball Electrnc vs. Amazon Inc
Check out your portfolio center. Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

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